The dividend yields on these top 100 stocks just got enticingly better

All else equal, a lower share price means a higher yield.

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The dividend yield of a stock is a direct correlation between the dividend payable over the next 12 months (or paid if you're considering historic yield) and the current share price.

While on the one hand the start to 2014 would appear to have been a good one with the interim reporting season not causing too many unexpected headaches, the US market hitting a record high and even the S&P/ASX 200 Index (Index: ^AXJO) (ASX: XJO) hitting a new multi-year high. On the other hand despite all of these positives, a number of top 100 companies have experienced significant falls in their share prices this calendar year despite the index being essentially flat year-to-date.

The following three stocks have all declined this year, however analyst consensus estimates suggest they are trading on very enticing financial year 2015 dividends.

Arrium Ltd (ASX: ARI) is exposed to mining and steel production which means the last few years have been something of a roller coaster for shareholders. The stock has lost 26.3% this calendar year to be currently trading at $1.29. With a consensus estimates for a dividend of 10 cents per share (cps), the stock is yielding 7.75%.

Insurance Australia Group Limited (ASX: IAG) has experienced a much more moderate 7.2% fall in its share price this year. While not a significant drop it has still increased the appeal of an already above average yield. With the share price at $5.40 and a forecast dividend of 35.2 cps, the stocks is trading on a yield of 6.5%.

ALS Ltd (ASX: ALQ) provides technical testing and inspection services not only to the resources sector but also to a much wider cross-section including health care, hospitality, food and pharmaceutical sectors. Its exposure to the slowing resource sector has of course concerned investors and its share price has lost 18% this year. Despite its resource sector exposure, ALS is still expected to pay 37.5 cps of dividends in FY 2015. Based on its current share price, the stock has a forecast yield of 5.2%.

Foolish takeaway

While lower share prices often scare investors from the market, this is exactly the time to be enticed to the market, as bargains rarely last for long.

Motley Fool contributor Tim McArthur does not own shares in any of the companies mentioned in this article.

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